Relating to: regulation of pharmacy benefit managers, fiduciary and disclosure requirements on pharmacy benefit managers, and application of prescription drug payments to health insurance cost-sharing requirements. (FE)

AB 173 regulates pharmacy benefit managers (PBMs) by requiring them to disclose formulary details and drug costs to health plans and patients before enrollment. It prohibits PBMs or insurers from penalizing patients for choosing specific pharmacies within a network or charging different fees for the same pharmacy services. The bill also mandates advance written notice (at least 90 days) to patients when drugs are removed from formularies or moved to higher-cost tiers, including exception request procedures. These changes directly affect PBMs, health insurance plans, and patients covered by those plans, aiming to increase transparency and choice in prescription drug coverage.